Registration of firm upheld where minor partner attained majority and was admitted retrospectively as partner during the accounting year.

A firm was held entitled to registration where a person who had earlier been a minor enjoying only the benefits of partnership attained majority during the accounting year and was admitted as a partner with effect from an earlier date. The Court applied its earlier rulings that such retrospective admission of the erstwhile minor, after majority, does not bar registration for the relevant assessment year. On that basis, the legal position was treated as settled in favour of the assessee and the reference was answered accordingly.

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Issues: Whether the assessee-firm was entitled to registration for the accounting period relevant to the assessment year 1976-77 where a person who had been a minor and had enjoyed only the benefits of partnership attained majority during the accounting year and was admitted as a partner with effect from an earlier date.

Analysis: The Court applied its earlier decisions holding that, if during the accounting year a minor attains majority and is admitted as a partner with effect from a prior date when he was still a minor, registration of the firm can be granted. On the facts, the Tribunal had granted registration on that basis, and the legal position was treated as settled in favour of the assessee.

Conclusion: The reference was answered in favour of the assessee in the affirmative, and the firm was held entitled to registration.

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